The Kick-off to GDUFA II

With June 15th quickly approaching, the industry is preparing to discuss the progress under GDUFA I with FDA while also being able to extol the successes and shortcomings of the first iteration of GDUFA.  FDA has been promising an increase in communications, Target Action Dates (TADs), mid-cycle review, and advanced notice of potential approvals, but, so far, not enough experience with any of these provisions has been seen by the industry for any conclusions to be drawn.

Industry complaints continue to mount relative to the lack of substantive communication.  I heard from one former FDA official that, when inquiring about some ANDA applications that have grown whiskers (2-3 years old) with no first review, the status updates they received consisted of only the “applications are under review.”  Come on, now, that response is getting old; it actually provides no useful information at all about the ANDA, and simply means that FDA has the application, but is doing nothing to even guess when an action might occur.  I had a professor in grad school that used to say “never try to teach a pig to sing, it wastes your time and annoys the pig.”  This is essentially what industry does when it inquires about the status of an ANDA; it wastes industry’s time and annoys the FDA.  So how can GDUFA II negotiations help both parties?  There needs to be a concerted effort from both sides to provide concrete options for providing more useful information that can meet the industry’s needs without annoying the FDA and wasting their time.

TADs may help, but, as noted above, there has not been enough experience with the illusive TAD so far to tell whether it will meet the industry’s need to make informed business decisions.  Suggestions regarding increased enhancements in the FDA IT systems to permit secure peeks into the review queue to track progress of a firm’s ANDAs (like the Canadian system) have been made, but, while that may be beyond current capability, perhaps funding under GDUFA II for some type of system enhancement may be doable.

While the patience of the industry is wearing thin, timing of the public meeting on June 15th and 16th is perhaps unfortunate because of the lack of industry experience with the OGD enhancements discussed above.  Maybe they will work and nothing more will need to be done, but somehow I don’t believe that.  There is certainly no time to waste in delaying the discussions for GDUFA II because of all of the work that needs to be done to assure GDUFA II will be ready for FY 2018.  So this poses a rather significant dilemma and raises an important question.  Should the industry be negotiating for big changes in GDUFA that will be very expensive?  If they do and find that it was actually a slower ramp-up time for GDUFA I that was the real problem, then industry may be buying more than they need for years 2018-2022.

The other issue that must be discussed in any new negotiation is the fee structure for facilities and the impact that the current structure has on small manufacturers and contract manufacturing organizations.  With the 42-month median approval time, that can mean almost four facility fees prior to approval, which puts the fee costs at close to $1,000,000 dollars prior to generation of any revenue for the product.  If a Contract Manufacturing Organization (CMO) is being paid $100k for the exhibit batch production or packing functions, that could be a significant motivating factor that steers CMOs away from generic work.  These types of fees may also be a disincentive for new smaller manufacturers or other players to get into the generic game.  We know that facility or establishment fees for NDA products under PDUFA do not kick in until NDA approval, while ANDA facility fees begin at submission of an ANDA.

There is a lot of work to be done to get GDUFA II in place and there are not a lot of metrics available upon which industry can rely to take a good faith negotiation position.  Perhaps FDA has some information up their sleeves that will be shared at the public meeting.  Communication and transparency will likely be the key to the negotiations along with continued emphasis on improvement in the rate of approvals and reduction of review times.  All-in-all, these issues present major challenges to both the FDA and industry, and the upcoming public meetings will either be the beginning of the road to resolution, or (if things don’t go well), maybe the end of the road.  I don’t think anyone truly believes that there will not be a GDUFA II, but its face may be somewhat different than GDUFA I.